Texas and America's four great growth wavesUpdate: A somewhat expanded and refined version of this post can be found on the New Geography website here.
Update 2: A Dallas Morning News editorial by columnist William McKenzie discussing this post can be found here. Hat tip to David Winans.
Let's talk about the really big picture - like 200+ years of American history. It seems to me there have been four great growth waves in our history. In each case, there was an attractive new frontier, which not only drew migrating waves of people seeking new opportunity, but also developed large new bases of industry, wealth, and power.
- The Boston, NYC, Philadelphia, Baltimore, DC corridor: America's original land of opportunity, wealth, and power. NYC was the big winner, and DC and Boston still do quite well.
- The rise of the agricultural and industrial Midwest, including Chicago, Detroit, Pittsburgh, Cleveland, and St. Louis. The fall here has been a hard one as manufacturing moved abroad, but Chicago still stands as a world class city produced during the region's heyday.
- The great westward migration, mostly focused on California, but with ancillary growth in adjacent and west coast states. This migration started well before WW2, but really took off after the war, and produced two top-tier mega-metros, LA and the San Francisco Bay Area, and several successful second-tiers like Seattle, San Diego, Las Vegas, and Phoenix.
The fourth wave is increasingly clear: Texas and the new South.
Just as CA had its pre-war growth surge, Texas had its first real growth waves with the 20th century post-Spindletop oil boom. They had the dust bowl migration of the 30s, and we had the oil boom of the 70s. But the real mega-surge has become more clear in the new century as CA hands off the baton to Texas. This growth wave really covers much of the South, but Texas is the 800lb gorilla vs. states like Georgia and North Carolina, just as California dominates over Washington, Nevada, and Arizona. I would argue we even loom over Florida, which certainly has experienced incredible population growth (now the #4 state), but has had disproportionately less success with building industry, wealth, and power (I'm not counting people who built wealth elsewhere but bought a FL second home), including few Fortune 500 headquarters, making it similar in some ways to Arizona.
The great cities emerging from this new wave are Atlanta, DFW, and, of course, Houston. They dominate the census growth stats (Houston story), and all indications are that Houston will pass Philly in the 2010 census to join DFW in the top 5 metros along with NYC, LA, and Chicago (interesting side note: we're the largest metro the census doesn't subdivide into multiple metro divisions). We're even approaching the combined SF Bay Area population of 6.1 million. And Texas passed California for #1 in the Fortune 500 HQ rankings last year.
Want more evidence? Check out this impressive video on the Texas Triangle with an overwhelming list of stats that make the case (hat tip to Mark at the Texas Triangle Business blog). In the video, they refer to the region as the 18m-strong "Texaplex", which is just a little too DFW-Metroplex centric for my tastes. You can also see their Texaplex informational brochure here.
When you look at it this way, it's clear Texas will be the focal point of America's growth for at least the next few decades. History also says at least one, and possibly more, truly top-tier world cities will emerge from this wave (and there's a good case to be made that we're already there). It's easy to get caught up in the day-to-day hubub and crisis-of-the-moment, but take a minute to stand back and see the big picture. You're part of a great historical wave that's just starting to really take off, the same as being in Chicago at the turn of the century or in California after WW2. Pretty cool, eh?
Update 3: A supportive excerpt from Bloomberg:
One thing hasn’t changed in this recession: Those who are mobile will continue to move where jobs are relatively plentiful and housing is cheaper.
The winners continue to be southeastern states and Texas. Some 67,000 single- and multifamily building permits were issued in the southern region in the first three months of this year, according to the U.S. Census Bureau.
Texas alone accounted for more than 20,000 authorizations. Hot spots are still Houston, Dallas-Fort Worth and Austin.
Considering that almost 120,000 permits in the entire country were issued during that period, it shows that more than half of all new construction is in the South, where the cost of housing and living is significantly lower than in the Northeast, Midwest and on the West Coast. In contrast, just 5,571 units were approved in New York and New Jersey combined.